TL;DR
India's auto component sector is projected for 10% annual growth through 2030, driven by diversification into semiconductors, defence, and EVs, and strategic investments.
The Indian auto component and precision engineering industry is projected for rapid growth in the coming years, with investment banking firm Goldman Sachs forecasting an annual growth rate of 10 percent from fiscal year 2026 to fiscal year 2030. This optimistic outlook signals a significant transformation for indigenous manufacturers, who are traditionally seen as cyclical automotive suppliers dependent on auto sales.
The industry is actively diversifying into advanced sectors such as semiconductors, defense manufacturing, aerospace engineering, electric vehicles, and data centers. This strategic pivot is expected to boost the total industry revenue from approximately $85.6 billion in FY26 to an estimated $124.4 billion in FY30. Operational profits (EBITDA) are also anticipated to grow at an even faster average rate of 15 percent annually, driven by the shift towards high-margin precision components.
Key drivers behind this industry transformation include global supply chain realignment, with international technology, automotive, and industrial firms seeking alternative manufacturing hubs for resilience. Indian component suppliers are responding by making substantial investments in cutting-edge tooling and machining. This expansion beyond traditional vehicles aims to mitigate the seasonality associated with automotive cycles, positioning India's auto component sector for sustained long-term growth.
